How to do Lean when your customer is your business

This past week I had the opportunity to work with Rovio’s team, teaching them about Lean Startup. While getting the hang of Build, Measure, Learn, my team was saying that Lean Startup couldn’t apply to them because they are making entertainment products, not solving a customer problem. I’ve heard that argument before not only from entertainment companies, but also internal teams trying to solve problems for the business. Yes, these teams are not usually solving the dire needs of their users. The user is either delighted by their experience (entertainment) or tolerant of your business optimization (increasing revenue).

When I was starting out with Lean at OpenSky, I ran into this problem. As a Product Manager, I would get handed themes or features about what we should build next from upper management. The goal was always to increase revenue. I was struggling with how to apply this exact model to solve our business problems. My “customer” (OpenSky) and my “end user” (actual users) were not the same people. How do you apply lean to get people to invite their friends? How do you figure out an end user problem to “we need customers to buy more things”? Those are purely business problems. No customer is banging down the “door” of a clothing shop saying pllllease take more of my paycheck.

BUT you can still use lean in these cases. This is how.

Do Build, Measure, Learn in reverse.

opposite-loop

Instead of focusing first on what your customer problem is (and here you will get stuck for reasons I said above) start with this question: What do we want to learn?

Ask your team and managers what do we want to learn about our users in the context of this business problem. For example, when a manager tells you they want users to visit your site more frequently, you turn that into: “Why are my users not coming back to my site more than twice a month?”

Now you can call your customers who are not returning and ask them why. Are they having specific problems with the site? Learn what they come to the site for, why they come when they do, and what prompts them to revisit sites in general. Sometimes this act alone will help you discover a big problem for the customer. Maybe the user wanted to come back to the site but always forgot during their busy schedule. You can start with your build measure learn loop right there.

Most of the time, you are going to struggle to find that “dire” problem the customer has that solves your business need. From this question, I’d expect to hear “I forget, but it’s not such a big deal for me. I like shopping when I remember to.” So after researching, you build an experiment around the how. “What can I do to get users to come back to my site more than twice a month?”

Figure out how you would measure that lesson. In this example, we would want to track how many times per month users visit the site through our vetted channels.

Take what you learned about users and create a hypothesis and a test about what they will do and enjoy. “My customers come to our site when we send emails. My users are always trying to keep in touch with their friends. I think if we send them an email once a week with activity their friends had on the site, they will come back.”

Set your minimum success criteria to gauge your progress. We’ll send this email to 100 users for one month. If we get 60/100 people to click through and visit once a week, this will be a success. Then run and pivot as you would with any Lean concept.

Doing Lean inside an existing business is actually EASIER than at a startup. You already have customers to tap into for running your experiments. There are actual users to call for research when they do not respond to your initial tests. This makes doing Lean a million times easier, and should not be put to waste! Lean is not just for startups.

Try this and let me know how it goes.

5 Lessons Learned in 2013

Giving the Prime Minister a Shirt

In 2013 I spent 210 days in Europe. Lived in 2 countries. Visited 8 countries, 5 of them for the first time. Had 3 different jobs. Founded 1 company. Raised €25.000. Spoke at 2 conferences, 3 meetups, 2 accelerators. Made friends from 19 different countries. Flew my dog 8000 miles. Went to 1 hackathon, came in 2nd. Took a spontaneous trip to Slovenia. Skied the alps once. Participated in Oktoberfest. Moved across the world, and then came back home.

2013 was a rollercoaster of a ride. I got the chance to do many things I’ve always wanted to, and for that I’m thankful. There was also a lot of hard lessons to be learned along the way, making it a pretty stressful and by no means easy year. Worth it though? Yes. Keeping the same tradition as last year, here’s 5 of the biggest lessons I’ve learned along the way.

1. Trust your gut

I have always given things a fighting chance to work out. Jobs, relationships. I am a fixer by nature, and I try to fix broken things. I keep telling myself “but it might get better and then you’ll want to be here so try your best to figure out what can be mended.” I do like the concept of giving things a fighting chance, but somewhere along the way, I started giving things a chance for too long. I stopped listening to my gut.

In Italy, I formed a company with three other people. One left at the very beginning and we were down to three of us. Soon, problems started arising with one of the cofounders. Big problems that just couldn’t be shoved under a rug. I stuck around for about 4 months after the warning signs emerged, hoping things would get better, trying to make them so. My subconscious was telling me it never would, but I thought in my head, if we could just fix this relationship, we could make a successful business and keep going. It came to a point where I had to make a decision to finally trust my gut or keep fixing. I chose to leave. The next morning, I felt like a load of weight had been finally lifted from my shoulders. I started to feel better too, less stressed and more healthy. I started hanging out with a lot of other people in the program, and made many friends I intend on visiting and working with in the future. Everything finally got better.

Your body can tell you a lot that your mind can’t. Have you ever made a decision but felt sick to your stomach? I have. Something inside you is telling you that it’s the wrong decision. Don’t ignore it. I spent too much time listening to my head this year. Next year, I’m going to listen more to what my gut tells me.

2. The grass may be greener on the other side, but its not your grass

I always wanted to live in Italy. It’s a more relaxing life there. There’s thousands of years worth of history that we don’t have here. In these cases it is better than the US, but we always want what we don’t have. Living in Italy was a great opportunity. I learned a lot about people. About cultures. About bureaucracy. I would never have been exposed to these things had I stayed in NYC. But, I also learned a lot of what we have right here is better. I’m thankful I can come home to that.

When you work in startups, like me, the US provides you with so many more opportunities than many countries in Europe. The bureaucracy I witnessed there was astounding. You’d go broke just trying to incorporate a company in Italy. Most of the people I worked with were trying to come here. I wish our immigration laws would let them. There’s a slew of talented people who could be creating jobs with their startups in this country. For me, I learned this is the right place to be when I start a company.

I by no means want to stop traveling. In fact, I want to travel more. There are still places I want to see, cultures I want to experience. I want to live somewhere else for a while too, experience that city, it’s highs and lows. Berlin is looking pretty good. But I will not take for granted the excellent opportunities we have in the US when it comes to smoother processes, salaries, and starting companies.

3. You don’t have to settle

For the first time in my life, I’m not 100% sure what I will be doing next. I’m fortunate to have many opportunities, and I want to be sure I pick the best one before I dive in with both feet. 2 years ago (hell, last January) not having a full time job lined up would have scared me to death. I couldn’t fathom leaving one company without knowing where I would be next. When I was no longer happy at OpenSky, I started looking for my next opportunity. At first I couldn’t find anything I liked. I had a list of things that were very important to me, but none of the companies I interviewed with fit the bill. After a few months of searching, countless interviews, and many offers turned down, I was offered a job at Conductor. I had reservations about the company culture and the size, but for the most part it looked like a really good fit and I was tired of searching. I took the offer and started quickly after, excited to get to work. After only a month though, I could tell it was the wrong place for me. The culture and the size turned out to be quite different from the environments in which I thrive. It just wasn’t a match. When the opportunity to go to Italy arose, I jumped at a chance to build something of my own.

This time I’m not settling for anything less than “Hell Yes!” I want to find something to work on that keeps me up at night. For now, I am consulting on UX Design, Product Strategy, and Lean Methodologies, something I really love doing (so reach out to me if you want to chat!). I’ve been advising various startups and teaching classes and workshops. By doing the things I love, I’m confident I’ll find something I really want to be a part of instead of settling for something less.

4. Surround yourself with people who make you better

Ever have a friend that always said they would hang out and never followed through? How about a coworker who always put down your ideas? I’ve had quite a few in both categories. This year I learned to cut them loose.

I met a lot of different people this year. Some awesome, some not so awesome. I met people who made me want to stay up until 4am trying to hack things together. I had my first brush with men who could not stand to have a woman CEO. I made some friends who’d let you invite yourself over for dinner on a bad day without warning. I saw firsthand people who would do anything to be perceived as important. There’s a lot of people in the world, and who you choose to associate with has a huge effect on your happiness and productivity. I spent quite some time this year on people who brought me down. They chided my ideas. They ignored my calls. They didn’t support me.

Near the end of the year, I started making some changes and cutting out these people. Turns out, once you get rid of those toxic people, you have room to surround yourself with people who make you better.

5. Let go of your things

I lived for 6 months out of 2 suitcases I brought to Italy with me. When I got there I bought a hair dryer, a toothbrush, and necessarily toiletries. Oh and a fan, because it was DAMN hot in August. Wish I bought that sooner. I didn’t wear some of those clothes because, well, startup life. Also, I only had 2 pairs of shoes once it got cold, but if I had one more pair I probably would have been set.

I opened up my storage when I got home and felt like someone from Hoarders… and it’s really just a small storage! But now all the things I own seem to weigh me down. Why do I keep all those college t-shirts from slope day? Every time I thought about moving in the past I always had some excuse to tie me down. My apartment is too awesome, and I love living with my roommates. I have too many things and I’ve been moving the past 9 years. I REALLY need a tortilla press and 7 coffee makers, so obviously I should just stay here. All these things ended up being a huge burden while I was away, even with a lot of help from some very special people. There were arguments, payments on storage, and just a ton of stress. If I didn’t own so many things, where could I go? Where could I move to if I wasn’t worrying about them?

I’m taking a look at everything I own this year and reducing the clutter. I’m keeping my Cole Haan boots though and by god I will wear them all over NYC, even if I want to sit down, rub my feet, and cry a bit every 5 blocks.

So here’s to 2014. Travel often, work on things you love, and spend time with people who matter.

Please Stop Misusing Buzzwords

Please. Please, just stop. Stop using buzzwords if you do not know the meaning. Somewhere in the past couple of years “agile”, “lean”, “mvp”, and “scrum” became the “it” thing in the tech world. Everyone wanted to be agile. Every manager wanted to say they use scrum. I’m a huge proponent for these methodologies and practices – look above it says lean all over my page. I think they can really turn companies around and produce great products when implemented and used correctly. But, I have seen a fundamental problem with a lot of teams and people who claim to be agile or lean: they have absolutely no idea what these words actually mean.

Here’s one example of the wrong use of a buzzword gone haywire. During August at Techpeaks, the staff announced they were implementing a “scrum of scrums” every Wednesday. Upon hearing this new plan, I asked myself “What the hell, is that even possible?” If you know what scrum is, you will understand that this term doesn’t even make sense. It got better when they explained that during this “scrum of scrums” we would have a mandatory 2 hour meeting with all 20 teams at Techpeaks where each team would stand up and say what they did last week, what they’re doing next week, and what problems they need help on. At this point, I audibly said “what the hell?” Obviously, this is just a progress meeting to keep track of what the teams are doing, but by using the term “scrum” a whole abyss of misunderstanding opened up. Teams started freaking out that the day for scrum didn’t match up with schedule for scrums that people were doing in their teams. Huge debates started about teams changing their scrum schedules to match the Wednesday end date, or move the Wednesday date to Friday so they can report on what they did. This discussion went on for weeks and weeks, and “scrum of scrums” (which ironically got shortened to “sos”) became a huge point of contention and anger for all the participants.

The misuse of one word, “scrum”, started a landslide of problems. Our common language started to unravel. One group was no longer on the same page as the other, and working relationships became utterly confusing. This is the danger of using buzzwords without understanding the meaning. The words become nothing more than a shiny badge of honor for being “cool” in this industry. Congrats, you are a lean startup and the new hip place to work. But what happens when you advertise this and attract people who actually know lean startup, and want to conduct lean experiments? They will be unhappy, because you will have promised them something different than what they understood. I know, it’s happened to me.

It’s imperative that we cut the crap with buzzwords and start using them properly. Simply launching a landing page does not necessarily make you “lean”. Deciding to chunk up a large project over 4 weeks does not necessarily make you “agile”. There are theories behind all these practices that were lost along the way. So here is my quick refresher on what these common buzzwords really mean and some common misconceptions:

Agile

Agile is a set of software development methods that focuses on iterating products incrementally. Agile values continuous delivery, personal interactions over documentation, and close collaboration between cross-functional teams to plan and evolve requirements and solutions. You can read the Agile Manifesto here and the 12 principles of Agile here.

One common misunderstanding I see is when developers require Product Managers to write out a complete, multipage, highly detailed spec before starting development on any products. The first half of the Agile manifesto states “Individuals and interactions over processes and tools. Working software over comprehensive documentation.“ Working face to face inside the team rather than handing off documentation not only creates a more collaborative environment, but it surfaces problems earlier.

Scrum

Scrum is an Agile framework that embodies the Agile manifesto in its practice. Scrum contains 3 core roles: the Product Owner, the Scrum Master, and the development team. Work is defined and agreed upon by the team and then sectioned off into sprints of a certain length. Scrum values teams working together to complete a common goal, responding to customer’s changing needs, and delivering quickly. You can read more about Scrum practices and values here.

Scrum is not a rigid process, but many teams understand it to be. One very common statement I hear from teams practicing scrum is that once the sprint is planned, nothing can be changed. This directly contradicts the flexible nature of scrum and one of the principles of Agile: “Welcome changing requirements, even late in development.“ This is not to say that you should be changing what you’re building all the time, but learning to be open to changes in product backlogs and deciding if they are a bigger priority is key.

Lean

Lean is most commonly used in our industry referring to Lean Startup principles, but Lean originated from the Toyota Production System and the term is also used for Lean Software Development. Using the term just “lean” can get really confusing depending on who you are talking to. For our sake, we’ll stick with Lean Startup Methodology when we refer to Lean here. Lean Startup Methodology focuses on building what customers will use, not what you think they will use. It values eliminating waste, maximizing learning, and measuring results. Iterating through the Build-Measure-Learn loop quickly is the goal.

Many folks miss the maximizing learning part of Lean. They build products quickly, release them to customers, and ask them if they like it. As soon as they get a yes or see a bit of traction, they think they are done. They stop talking to customers, and just keep building. Soon customers are out of the feedback loop. If you are focusing more on building your solution than learning from your customers, you are not Lean.

MVP

“Minimum Viable Product” is the least amount of work you can do to learn from your customers. MVPs are experiments, not minimum feature sets. In fact, an MVP can be manually delivered without a website at all. The main goal of an MVP is to learn if customers have the problem you assume and want your solution.

Many people think an MVP is just the minimum website they can create for their product, most often a landing page. While a landing page is a good tool to gauge customer interest, every MVP is not a landing page. A landing page is just one piece of the experiment. Targeting the right subset of users, driving traffic to the page, and delivering results is the entire MVP.

One day, these buzzwords will die down and others will emerge. This whole cycle will start again – learn, practice, fad, misunderstanding. It’s always a good move to educate ourselves and others on new trends, to make sure we understand the deeper meaning behind these words and keep a common language in our workplaces.

Lines Not Dots

When you first meet someone interesting, you usually start slow, talking about yourselves and getting to know each other. We don’t normally start discussing how awesome we are, and hit someone up for a favor… unless you’re an asshole. So why do we do that with investors?

This past week I was at Web Summit in Dublin. There were 10,000 people there. 600 startups (one of them was FlowsBy). Very very few investors. So when the startuppers did see a purple investor badge, they panicked and started running after them. I watched as Dave McClure got off the stage, and was immediately pounced upon by at least 30 people. They were shoving papers in his face, wildly trying to put a business card in his pocket, and pretty much screaming pitches at him. It was like a scene from animal planet. Dave looked like he wanted to be anywhere else but there.

I’m not an expert, but I’m pretty sure you don’t want the person you are trying to get money from to feel like they have to run away from you as soon as they meet you.

The last night at Web Summit, I actually ran into Dave at a small party. Well more like he kind of fell backwards into me and we started talking. We chatted about the conference and random things. I told him I saw the gang of people descend on him when he left the stage. When I asked if that pretty much came with the territory, he sighed and said “Yeah… but I have no patience for that at all.”

As startuppers, we tend to think of investors as “higher beings”. They can make us successful, or make us fail. We give them hero status, look at them in awe, and by doing this, forget that they are actually human beings who need to be treated like so. We need to start having normal conversations with them, and stop asking for things right off the bat.

One of our first presentations at Techpeaks was from Evan Nisselson. He quoted a line from a post by Mark Suster on investing:

Investors invest in lines, not dots. - Mark Suster

Evan’s advice was to talk to people, get to know them, and build a relationship before asking for something in return. In this way, you’ll be remembered AND you’ll also get to know the person. I don’t think any of us want to do business with someone we don’t know, or with whom we can’t have a normal conversation.

There were tons of awesome people at that party – Robert Scoble, Elon Musk, CEOs, Investors, Founders. I got the chance to talk to all of them for hours (yeah even Elon!), but I never pitched anyone. When we talked about what we did I would tell them about FlowsBy. Some people wanted to hear more so we chatted and I received some great advice and feedback. But no one was there to hear me pitch. They weren’t there to hear anyone pitch. They were there to have fun, relax, and party their asses off. And we did. Until 6am.

The next time we run into each other, I’ll ask them how they are doing, and how’s life. There’s a better chance they will remember the person they had great time talking to and partying with at the only place open in Dublin that one night than the hundreds of people who pitched them at Web Summit as they passed by. That’s because we started to form a relationship. We took the time to get to know each other, even for a few minutes or hours.

So I challenge all startuppers out there, to fight the urge to pitch to every investor you just meet. You have to actively work to build relationships with people. Relationships last, even when companies don’t.

5 Observations About European Startups

For the past 5 months, I’ve been living in Italy starting my company, FlowsBy, at the Techpeaks Accelerator. I’ve had the chance to work with some amazing people from 19 different countries, right here in Trento. During August, I also had the chance to visit iCatapult’s accelerator in Hungary to speak to their new class of startups.

There was no end to the shock when I told people I was going to start a company in Italy. “So you’re leaving the second biggest startup hub in the US to go to the middle of nowhere Italy to build a company. Makes sense…” “Does anybody even work in Italy?” There was also lots of encouragement, but I also think those people saw this as more of a sweet 6 months “working” vacation and told me to have fun and “YOLO”. Not quite what’s been happening.

For me, a major reason I chose to come here was to get out of my comfort zone. We are incredibly innovative in the US, we have lots of things going for us. But, at a certain point you forgot there is anything else in the world but the US. I got very wrapped up in my own way of living and working, and I got complacent. I hate being complacent. It doesn’t force you to work harder. It doesn’t force you to be creative. So I came here not only to work, but also to learn how other countries work and think and live.

After 5 months, a few things have stood out to me about the startup community in the countries I’ve been familiar with here. Most of this relates to Italy and southern Europe, since that is what I know best. None of this relates to Germany, Switzerland, Austria or any countries up near Sweden, Finland, etc since I haven’t had the pleasure of meeting them yet. 

Europeans are great problem solvers

When I was in Hungary at the iCatapult accelerator, one of the participants asked Zoli Piroska, a question.

“What’s the difference between entrepreneurs in Hungary and entrepreneurs in the US?”

Zoli’s answer hit it on the head for me. He responded that Hungarians are great problem solvers, but Americans were great executors. I’ve also seen this in Italy and other countries as well. Europeans are used to dealing with terrible bureaucracy, people not wanting to do their jobs, and everything being closed on Sunday (this still gets my goat). They have been problem solving their entire lives. Every time I got a bit stressed out from some bureaucratic BS at Techpeaks, my cofounders from Rome would be calm as ever. “Don’t worry, we’ll take care of it.” As mafia as that statement sounds, that’s what Europeans do. They work around the problems with a calm and grace we don’t have in the US. We’re used to things working, and when they don’t we get stressed out or pissed off. Europeans on the other hand, are used to almost nothing working, so they’re immediate reaction is to go into problem solving mode. This is a wonderful trait to have in cofounders, and I’m really lucky that both of mine have it.

On the other side of Zoli’s statement, he said Americans are better executors. I have to agree with this. In the US, we have the motto of “get shit done”. We’re incredibly efficient so that we can get more done in less time, and we know how to prioritize. I’ve seen quite a few startuppers here get hung up on things that just don’t need to be done now, or are a lower priority. Some of this is just lack of experience, and some of it is the environment they live in. I was standing in line at the grocery store the other day as the checkout lady slowly read every one of the 200 items in front of me and then commented on them to the purchasers. It was my own personal hell. Life tends to move at a slower pace in Europe, and it’s a wonderful pace if you want to relax, but it takes a toll on the work that European startuppers can get done. When the services you need to operate are closed, or people don’t care if it takes 3 weeks to get you a document, you are forced to move at that pace.

There is a different way of speaking

On the topic of inefficiency, one of the biggest challenges for me working with Italians has been learning their way of speaking. Not the Italian language, but the manner in which people speak. In Italian, there are a lot of pleasantries that are common practices. Some of these pleasantries don’t even exist in English, for example the formal “you”. For the others, we have similar ways of speaking in English, but most people would never talk like that. We prefer to get to the point quicker and be direct (without being an asshole). It’s something we’re taught in writing and speaking from an early age. Unfortunately, this can be seen as incredibly rude to any latin language speaker. I’ve run into this problem a few times here, which has made incredible strains on working relationships. Worried that I was being incredibly rude (because I know I can be short sometimes) I talked to people who worked regularly between the US and Europe. They experienced the same problems I have about the language differences, and told me I need to learn to adapt. So everytime I’m about to say something I normally would, I take a breath and really think about what I’m going to say. It’s hard. It’s not natural to me. I find it really inefficient to take 20 minutes to say something I could in 2 minutes. But it works and it’s something you have to do if you want to do business with people in latin speaking countries.

On my team, we’ve come up with our own working language. We all speak English, sometimes there’s Roman thrown in (and sometimes I understand it), and every once in while my cofounders will speak Italian and I’ll answer very slowly in Italian. But the most important thing is, after a lot of conversations, that we found a way of communication that we can all respect, knowing that we come from different backgrounds. That’s critical.

There are fewer women in startups than the US

One of the more disappointing things I’ve found about European startups is that there seems to be fewer women here than in the US. Out of the 65 people in Techpeaks, only 6 of us are female. That’s a damn low number. I’ve met a handful of other women cofounders around Europe. One I met at the Mind The Bridge Bootcamp, where she was pitching her first startup with another female cofounder. She is originally from the US and lived in Milan for the past 7 years. She asked me why I think there are not more women founders or women even working in startups. I’ve also heard this question from 2 really great women cofounders in Hungary. It’s a hard question to answer.

One of the reasons is that we don’t tell our young girls it’s a possibility for them. But, when you’re older and you’re thinking of entering the field, it’s not easy. I’ve heard it said “misogyny is a full time job” for developers in the US, but it’s doubly so here. I don’t think Europeans intend it with as much malice as some of the brogrammers in the US, but they’re not used to working with women. I’ve heard so many conversations here which would end up as an HR nightmare at home. Also, a lot of things that I’ve heard developers say at home in general about women, have been directed solely to me by peers here. It takes it to another level, that is incredibly uncomfortable.

One of the advantages we have in the states (which shocked the Hungarian founders) is that we have groups like New York Tech Women and Girl Develop It, that were driving initiatives to get more women into the field and also support them. That support would do women well here. In order to include more women in the startup world (which can help you be more successful) I think many European cultures need to first recognize this as a problem, then learn to be more open to women in the industry, and definitely women leaders.

The Startup camaraderie needs some help

One of the things I love most about working in NYC, is that I know there are so many people out there who support me and want to see my succeed. We go to events together regularly, we run into eachother at meetups, and we always ask “What are you working on? How can I help?” This camaraderie makes work enjoyable and motivating at home. I think this is what makes us a powerful nation for starting companies. That’s one thing I’ve seen missing from Italy. Silicon Valley got to where it is today because of the community. When I first visited San Francisco, the whole community was buzzing with startup events, meetups, and people who were doing interesting things. Everyone I talked to was willing to sit down to have a coffee with me, introduce me to someone, or invite me to an event. It’s a magnetic place, and if you are in startups, you finally feel like you’re home, surrounded by likeminded people.

Italy, and Trento, has a long way to go to get to this place. Bringing in startups and entrepreneurial people is a great way to get started, but a true community has not formed yet. One contentious debate we got into with a community of startuppers in this area was on Facebook. We had been asking people in “Startup Spritz” to help us out with sharing surveys, giving us feedback, and just telling them what we’re working on. Some of the members of the group (not everyone) went on a rant that they shouldn’t help us and we weren’t “contributing” to the community so we don’t have the right to post. Meanwhile, one of the Techpeaks requirements is that each one of us does 40 hours of work in the startup community to help leave some knowledge and work in Trento. So the reaction in the group shocked me, as we had talked to these people and exchanged ideas before.

I’ve always been of the mindset of pay it forward, and if someone asks me for help, I will help. Then, when I need their help at a future date, I don’t hesitate to ask for it. This mindset just isn’t dominant here yet. I was really happy to see after this incident a lot of Techpeakers felt the same as me. We help each other out, we don’t expect things in return. We know that we’re a community that will support each other, and that lets us thrive.

It is expensive to start a company here

I am certain that the entrepreneurs in Italy are doing everything they can to make their companies happen. To some extent, I think they are also more driven and passionate about what they’re doing than some people in the US. Why? Because it’s damn expensive to start a company here. You have to shell out so much money, jump through so many bureaucratic hoops to incorporate in Italy, that you better be passionate or crazy to start a company here. Let’s compare:

USA: In the US, you can incorporate in Delaware for $239. If you make no revenue, you pay no taxes. If you do not personally get a salary, you do not pay any taxes. So for these costs, you pay about $239 to start a company, and $225 to maintain your company while it’s not making money.

Italy: In Italy, you have to go to the notary public with lawyer’s documents to incorporate. The fee for the notary was €1700, the fee for the lawyer is about €1500. You also need to contribute share capital, which was just lowered from a minimum of €2500 to €0, thankfully. If your company makes no revenues every year, you have to pay a flat tax determined by the gov’t, which we believe will be around €4000. If you are a shareholder for a company, but you make €0 a year, you need to pay €4500 a year in taxes. So for these costs, you pay about €3200 to start a company, and €8500 a year to maintain your company while it’s not making money.

Many people who want to start a company in Italy, are asked to fork over their life savings to do it, so you better believe they are going to work their ass off to make it succeed.

 

I’m really happy I decided to come to Italy to work. Although it’s been nothing but a rocky ride, to say I’ve learned a lot would be an understatement. Entrepreneurs in Europe may be few and far between right now, but they are driven. The government and cultures make doing their jobs hard, and most of them want to come to the US where they can raise money and do good work. I hope that we reform a lot of our immigration laws so they can do just that.

For the US people reading this, don’t underestimate the European startuppers. I have met some really amazing, hard working people here. For the Europeans reading this, keep chugging, don’t be too proud to accept help, and learn about American culture if you want to go there. There is a budding startup community here, a few years behind the US, but give it some time and the right mix of people, I think we’ll see it grow.